The coming economic ruin, with specifics
MEMORANDUM
Date: Post-Catastrophe America
Subject: Lots more specifics on “The Coming Ruin of the Economy under Obamacare”
From: Lawrence Auster
To: Conservatives who thought (a) that expressing your displeasure with Romney and the Republican Party was more important than stopping Obamacare; and (b) that there were no meaningful differences between the candidates.
Here is what you have helped bring about. Thanks, guys. No hard feelings. But I believe in justice, and I think that people should take responsibility for their acts, and for the pre-determined, pre-known consequences of their acts.
Mourning in America—Here’s Those Layoffs We Voted For Last Night
By Rusty Weiss on November 07, 2012 at FreedomWorks
Last night’s victory for the President marks the first time since its inception that Obamacare is no longer a what-if; it is the future of health care in America.
It also means a near immediate impact on the economy. With 20 or so new or higher taxes set to be implemented, ranging from a $123 billion surtax on investment income, through the $20 billion medical device tax, all the way down to the $600 million executive compensation limit, Obamacare will be a nearly unbearable tax burden on the economy.
Who will pay? The middle-class workforce, of course.
So with another four years for President Obama to look forward to, and the obvious inevitability of Obamacare that this entails, let’s examine the very real jobs that will be lost, and the very real lives that will be affected.
Welch Allyn
Welch Allyn, a company that manufactures medical diagnostic equipment in central New York, announced in September that they would be laying off 275 employees, or roughly 10% of their workforce over the next three years. One of the major reasons discussed for the layoffs was a proactive response to the Medical Device Tax mandated by the new healthcare law.
Dana Holding Corp.
As recently as a week ago, a global auto parts manufacturing company in Ohio known as Dana Holding Corp., warned their employees of potential layoffs, citing “$24 million over the next six years in additional U.S. health care expenses”. After laying off several white collar staffers, company insiders have hinted at more to come. The company will have to cover the additional $24 million cost somehow, which will likely equate to numerous cuts in their current workforce of 25,500 worldwide.
Stryker
One of the biggest medical device manufacturers in the world, Stryker will close their facility in Orchard Park, New York, eliminating 96 jobs in December. Worse, they plan on countering the medical device tax in Obamacare by slashing 5% of their global workforce—an estimated 1,170 positions.
Boston Scientific
In October of 2009, Boston Scientific CEO Ray Elliott, warned that proposed taxes in the health care reform bill could “lead to significant job losses” for his company. Nearly two years later, Elliott announced that the company would be cutting anywhere between 1,200 and 1,400 jobs, while simultaneously shifting investments and workers overseas—to China.
Medtronic
In March of 2010, medical device maker Medtronic warned that Obamacare taxes could result in a reduction of precisely 1,000 jobs. That plan became reality when the company cut 500 positions over the summer, with another 500 set for the end of 2013.
Others
A short list of other companies facing future layoffs at the hands of Obamacare:
- Smith & Nephew—770 layoffs
- Abbott Labs—700 layoffs
- Covidien—595 layoffs
- Kinetic Concepts—427 layoffs
- St. Jude Medical—300 layoffs
- Hill Rom—200 layoffs
Beyond the complete elimination of a significant number of American jobs is another looming problem created by the health care law—a shift from full-time to part-time workers.
Sean Hackbarth of Free Enterprise explains:
A JP Morgan economist “points out that 8.3 million people are working in part-time jobs even though they’d prefer full-time work. Unfortunately, because of President Obama’s health care law, the Patient Protection and Affordable Care Act (PPACA), workers in the hotel, restaurant, and retail industries could be pushed into part-time jobs working less than 30 hours per week.”
“Under the health care law, if a company has more than 50 “full time equivalent” workers, a combination of full and part-time employees, but doesn’t offer “affordable” coverage that meets the government’s minimum value standard, the company will have to pay a penalty. This penalty is determined by the number of full-time employees minus 30 full-time employees. So to reiterate a very important point: part-time workers are not part of the penalty formula. The health care law creates a perverse incentive to hire part-time versus full-time workers.”
Tangible examples of Obamacare causing a reduction in full-time workers:
Darden Restaurants
According to the Orlando Sentinel, Darden Restaurants, a casual dining chain best known for their Red Lobster, Olive Garden and LongHorn Steakhouse restaurants, is “experimenting with limiting the hours of some of its workers to avoid health care requirements under the Affordable Care Act when they take effect in 2014”.
JANCOA Janitorial Services
The CEO of JANCOA, Mary Miller, testified to Congress that Obamacare was a “dream killer”, adding that one option she had to consider “is reducing the majority of my team members to part-time employment in order to reduce the amount that I will be penalized.”
Kroger
The American retailer in Cincinnati, Ohio recently was reported to be planning a significant slashing of their hourly workers. Doug Ross writes:
Operative Faith (a mid-level manager with the company) reveals that Kroger will soon join the ranks of Darden Restaurants and slash the hours of its non-exempt (hourly) workers to avoid millions in Obamacare penalties.
According to the source, Obamacare could result in tens of thousands of Kroger employees being limited to working 28 hours per week.
Summary
This is by no means meant to be an exhaustive list. But it is meant to provide examples of real companies, real jobs, and real names, soon to be added to the growing list of employment casualties provided by the inevitable implementation of Obamacare.
Last night, America voted for four more years of President Obama and his destructive economic and health care policies. By extension, America last night voted their approval of the aforementioned layoffs and overall work reduction.
Now we must accept the inevitable. Welcome to mourning in America.
[end of FreedomWorks article]
Clark Coleman, who sent the article, adds:
Here are more stories on the same subject:
“Tsunami of regulations expected after Obama Re-election”
The Obama administration held up the normal publishing schedule of lots of new regulations, many of them EPA environmental regulations that will kill jobs, so that the regulations would not be announced until after the election.
“Post-election, Media is free to report on coming recession”
CNBC network analysts predict coming recession
Denny’s Joins Growing List of Restaurants Considering ‘Obamacare Charge’
Denny’s restaurants perceive that they will have extra expenses due to Obamacare, so one of their big franchisers has already announced he will pass the costs along in higher prices, or charge employees more for their share of benefit premiums, or some mix of the two.
Capital spending by corporations is about to fall off a cliff
- end of initial entry -
Paul Nachman writes:
Regarding the new medical-devices tax, I, too, regard the health-care monstrosity that was passed in March of 2010 as a chamber of horrors. But I think one of those horrors is being overhyped by our side: We frequently see claims that this tax will wipe out some large percentage of an affected company’s profits, so they’ll have to lay people off, curtail research, etc.
I’m a physicist, not an economist, but I think I understand this well enough to assert that the medical-devices tax is simply equivalent to a sales tax. If so, the general implication that the tax will wipe out profits seems misplaced: Why wouldn’t companies subject to the tax simply raise their prices so that they’d come out about the same afterward? There’s no competitive disadvantage in doing so, at least among domestic firms, since they’re all subject to the tax.
Sales tax increases are a frequent occurrence at the state and local level (e.g. what Californians just voted for themselves), and I don’t think there’s accompanying doomsaying about businesses shutting down as a result. Agreed, 2.3 percentage points, the size of the medical-devices tax, is larger than any such increase of which I’m aware, but the principle is the same.
Further, and importantly, I expect that the demand for high-tech, effective devices is largely inelastic, so the numbers of devices sold would hardly be affected by a 2.3 percent increase in prices to purchasers. Then profits would hardly be affected by the imposition of the tax, since about the same number of units would be sold and the profit per unit would be the same (since a company had simply taken its normal sales price and added 2.3 percent to it before shipping the devices out the door).
I’m aware of the explicit claims by medical device companies that the new tax will be hampering to ruinous, but I think those claims don’t stand up to a little thought.
I’m not suggesting that this new tax is a good thing. But if I’m correct in my reasoning above, we shouldn’t be using what amounts to a bad argument against it.
JC in Houston writes:
And to think, there was one man who could have stopped this catastrophe but instead washed his hands of the whole matter like Pontius Pilate. His name will live in infamy, the despicable John Roberts.
LA replies:
He didn’t wash his hands of it. He made it happen. He was the active agent in coming up with a whole new phony argument no one had ever thought of before. He was the one who established an unlimited power of Congress over individuals. And he did it in order to support the leftist Zeitgeist and keep Obamacare alive.
His name should be erased from the Book of Life.
If America were a healthy society, he and the other justices who voted for that decision would have been impeached. But the same is true going back at least 40 years. The justices who voted in the majority in the Roe v. Wade decision should have been impeached. And there should have been massive demonstrations against it—and not just of the peaceful, legal kind.
How many times can one say it? The American colonists engaged in a large scale illegal action and destruction of private property (the Boston Tea Party) over a tax on tea, which action, and Britain’s draconian response to it, led directly to the American Revolution. Yet we have not taken action against lawless and tyrannical government decrees ten thousand times worse than that tax on tea.
LA continues:
Our non-action exemplifies one of the things that is wrong with conservatives’ adoption of symbols from the Revolutionary era. For example, for the “tea parties” that took shape starting in summer 2009 properly to deserve the name “tea party,” they would have had to engage in illegal actions, not just polite legal demonstrations. For a similar reason, I expressed reservations about the use of the “Don’t Tread on Me” flag by the separatist movement. That was a war flag, used by Patriot forces once hostilities with Great Britain had begun.
The problem is that by the appropriation of such symbols we imagine that we are behaving like the American Revolutionists, when in fact we are not. Which puts us back in the usual conservative conceit of thinking that we are doing something against liberalism which we are not.
LA to Clark Coleman:
I’ve finally posted the FreedomWorks article you sent me about nine days ago, plus the additional links you’ve sent me.
I hope I’m not alienating some readers by chastising them for their non-Romney vote. But I had to say what I had to say.
Clark Coleman replies:
Voters need to learn to distinguish between existential threats to our civilization, and all other issues. We faced multiple existential threats in this election (Obamacare, immigration, runaway debt and entitlement obligations), and Romney was much better than Obama on all of these issues. If he was not strong on some other issues, so what?
LA replies:
It was, as has been discussed before, a fundamental failure of thinking on the part of these non-Romney voting conservatives. Suppose that Obama was a Communist and would bring about Communist rule. Would these non-Romney voting conservatives still have said: “I can’t stand the Republicans, they’re meaningless, they’re useless, they’re against conservatives like me, so I won’t vote for them no matter what”? They failed to understand that the issue wasn’t the Republicans or whether one supports the Republicans; I myself specifically said that I did not support Romney. The issue was opposing Obama and preventing his re-election. But these conservatives were so fixated on their dislike of the Republicans that they lost sight of the bigger picture; indeed, it could even be said that as a result of their obsession with the inadequacy of Romney they lost certain basic characteristics of thinking beings: (a) the primary, intuitive ability to identify an existential threat, and (b) the logical ability to distinguish and prioritize between an existential threat and an annoyance. When these conservatives see the ruin unleashed by Obama in his second term it is going to be very difficult for them to admit that they themselves, through a fundamental failure of their own thought processes, helped this to happen.
November 21
Dave T. writes:
Whether this thread alienates readers or not, it’s a very important point that you’re making. Obama in particular, and the criminal Democratic Party in general, collectively pose an existential threat to everything traditionalist conservatives represent, and, therefore, are always worth voting against even if we have no one in particular worth voting for.
I think conservatives lose sight of this calculation in their frustration with the Republican leadership, which they frequently hope to corral by threatening to withhold their vote. From my point of view, these frustrations are somewhat misplaced, at this point the Republican leadership could no more defeat the left and lead us out of this morass than an elephant could sprout wings and take flight. But, of course, to admit this thought is also to realize that our country (well, what was our country) is in deeper trouble than they’d like to admit.
Corey N. writes:
You are still blaming the wrong people. The coming economic contraction is not specifically the result of Obama’s election; it was going to happen anyway. It has been baked in the cake since 2008, when Bush supported the TARP and the banker bailout, instead of forcing them to confront the consequences of their admitted fraud. (It is a matter of public court record that they knew perfectly well the housing-derived securities they were selling could not possibly perform to the level they were advertised at, and in fact that they knew those securities were going to lose money.)
The bad debt has to come out of the system. The longer it stays in, the worse the eventual contraction must be. Electing Romney was not going to avoid this, no more so than electing Romney would have made two and two add up to five. It’s just math. Obama is making it worse; but if he had spent his first term fixing it, every single major bank in the USA would have gone bankrupt, and you would have been yelling about that instead. So the debts got transferred to the public balance sheet, and now the only way to write them off is a massive economic contraction.
Throwing a tantrum over this doesn’t help. It isn’t our fault. Those of us who could see what was coming and are taking steps to prepare for it are not responsible for creating the situation. If you want to blame someone, blame the large percentages of white voters in the Northeast and the West Coast that keep voting liberal; and blame Bush for not having the sense to see that going into debt does not create an “ownership society,” and that allowing banks to get away with theft does not inspire respect for the rule of law. That man COULD have avoided all this. He didn’t. He’s still patting himself on the back for “avoiding a depression.” He’s an idiot, and he’s wrong.
LA replies:
Corey N. doesn’t seem to have noticed that the issue in this thread is Obamacare, not government debt.
Debra C. writes:
I wonder why Corey N. left out of his invective against the banks the part about the Community Reinvestment Act, which was implemented by Jimmy Carter and enforced with an iron fist by Bill Clinton’s AG, Janet Reno, and was the reason why the banks were forced to be creative with derivatives in order to spread the risk foisted on them by Washington? My point is that whether its Obamacare or the housing-bubble crisis—both redistributive in their effects—it’s the progressive agenda implemented by leftist politicians that are dismantling and unraveling our once strong Constitutional protections and eroding our liberty.
November 22
Terry Morris writes:
Per your expression of concern to Mr. Coleman that you may be alienating some readers, I want to assure you that you haven’t alienated me. I may be wrong to do so, but I place myself in a different category from those non-Romney electors who live in and vote in swing States. But whether this is wrong of me or not, it is categorically false that I, in any way, contributed to Hussein Obama’s re-election by withholding my vote from Romney.
As far as O’care goes, I’ve fought it with every fiber of my being since the Congress first began debating it. But my main focus is on my State and its nullification of the law; making damn sure that it is carried out by the legislature and the Governor, and her A.G., despite her best efforts to fold under pressure. I want to help to make Oklahoma an attractive State for dispossessed traditionalist dissident-separatists. Otherwise I’ll be forced to move to Wyoming.
LA replies:
You felt that you could withhold your vote for Romney, because Oklahoma is such a solid Republican state that a Romney victory there was assured. But if all Republican voters in Oklahoma had followed your example of not voting for Romney, Romney would have lost Oklahoma.
This is an example of why I say that when we vote, regardless of whether our state is solid “blue” or solid “red,” we should vote the way we think all people should vote. In my opinion, that is the only way to vote responsibly. We should not use the fact that our state is solidly for one or the other party to avoid that responsibility to register the choice that we believe in and that we hope the whole country will choose.
Posted by Lawrence Auster at November 20, 2012 10:59 AM | Send